IRS Reminds Taxpayers to Report Crypto Income Before 2022 Filing

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As the 2022 federal income tax filing deadline approaches, the Internal Revenue Service (IRS), an agency responsible for enforcing federal tax laws in the United States, has released a list of reporting requirements for the general public dealing with cryptocurrencies.

Until 2021, the IRS used the term virtual currencies in income tax-related reporting forms, which have been updated for digital assets. All US citizens must answer questions about cryptocurrencies, whether or not they have made transactions involving digital assets.

The digital asset income question comes in three Forms 1040, Personal Income Tax Return; 1040-SR, US Senior Income Tax Return; and 1040-NR, the Non-Resident Alien Income Tax Return, which requests:

At any time in 2022, have you: (a) received (as a reward, reward, or payment for goods or services); or (b) sell, exchange, gift or otherwise dispose of a digital asset (or financial interest in a digital asset)?

Although all filers are required to answer the above question with a yes or no, the IRS has provided nine cases where you should check Yes, as shown below:

IRS cryptocurrency reporting checklist. Source: irs.gov

The above recommendations boil down to receiving, earning, transferring, or selling cryptocurrencies for any monetary benefit, including mining and staking. In addition to ticking yes, eligible taxpayers are required to report all income related to their digital asset transactions.

Revised 2022 Instructions for Form 1040 (and 1040-SR). Source: irs.gov

The only cases where one can check No on record are if they only hold the crypto assets, have transferred assets between the wallets they own, or have purchased cryptocurrencies for fiat currencies.

Related: US Authorities to Step Up Crypto Industry Scrutiny in 2023

A bill recently introduced in the first session of the Arizona State Senate in 2023 proposed that Arizona residents decide to change the state constitution with respect to property taxes.

As Cointelegraph reported, Bill SCR 1007 received two readings on the state Senate schedule, on January 19 and 23.

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